Special overnight update

Sold out.

Weekend headlines spelled doom for the Euro when it re-opened this week. First, when it came to their word, newly-elected leadership in Greece was sticking to it, and telling the Eurozone to stick it, too. Then, former Fed Chair Alan Greenspan was quoted giving his view that the Euro would not last.

The effect on the Euro was negligible (chart inset). Less of a blip-down, and more of an errant tick. And it has since firmed into positive territory.

Meanwhile, S&Ps reacted by rejecting Friday”s post-close firming above the 2050.50 cash session close. Then Friday afternoon”s 2041.00 target was touched (green line).

Did that fulfill selling pressure? The reaction up is touching 2047.00. They essentially threw everything AND the kitchen sink at the Euro, and it”s price action seems more interested in bottoming and rallying.

So far, the likeliest scenario that I described during this weekend”s Saturday Review is tracking. That is, fulfill the outstanding target below, and greet the cash session in rally mode.

This overnight condition need not improve overnight to still improve intraday. Exiting the weekend with a extreme sentiment is often a sentiment extreme. And that would resume last week”s rally. Otherwise, not recovering Monday morning would suggest much lower lows ahead.